Among a number of genes that escape X–chromosome inactivation in humans, three have been evaluated in mice and unexpectedly all three are subject to X–inactivation. We report here the cloning and expression studies of a novel mouse gene, Xe169, and show that it escapes X–inactivation like its human homologue. Xe169 was assigned to band F2/F3 on the mouse X chromosome by fluorescent in situ hybridization and Southern analysis indicates that the gene is located outside the pseudoautosomal region. Homologous, but divergent, sequences exist on the Y chromosome. In vitro and in vivo studies show that Xe169 is expressed from both the active and the inactive X chromosomes. Xe169 is the first cloned non–pseudoautosomal gene that escapes X–inactivaton in mice.